Odebrecht gets $720m financing for Lima toll road

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Odebrecht gets $720m financing for Lima toll road This article is part of a daily series of MegaProjects articles. If you want to know more about PPP projects with a considerable size visit our MegaProjects section. You can receive them by email on a daily basis.

Brazilian conglomerate, Odebrecht, has closed financing for the 'Rutas de Lima' highway concession in Peru.

The transaction combines financing from commercial banks as well as funding from local and international investors in a Peru's Rule 144A/Regulation S project bond. The financing is composed of US$520 million senior secured bonds and an approximately US$200 million senior secured loan.

While the commercial bank funding is provided by Peruvian commercial banks Banco de Crédito del Perú, BBVA Continental and Interbank, the bond portion included two issuances: one global PEN tranche (that is, Peruvian local currency settled in dollars) and another tranche in inflation-indexed Peruvian currency.

Goldman, Sachs & Co., BBVA, and Credicorp Capital were the bond underwriters. The law firm Mayer Brown has represented the underwriters in the transaction. Mayer Brown said in a press release that its team was led by Banking & Finance partner Christopher Erckert (New York/Washington DC) and included, among others: Corporate & Securities - partner David Bakst (New York); and Banking & Finance - associates Jane Kang and Augusto Ruiloba (both New York).

Odebrecht, the Brazilian conglomerate consisting of diversified businesses in the fields of engineering, construction, chemicals and petrochemicals, was awarded the PPP project in May 2012. The firm submitted an unsolicited proposal and there were no additional bidders in the tender process.

The project comprises the maintenance, expansion and operation of 98 kilometers of existing roads and the construction, operation and maintenance of 19 kilometers of new roads, intended to reduce traffic congestion and increase efficiency of the commercial exchange among Lima, the port of Callao and provinces located to the north, center and south of Peru.

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